Correlation Between Caribou Biosciences and Stoke Therapeutics
Can any of the company-specific risk be diversified away by investing in both Caribou Biosciences and Stoke Therapeutics at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Caribou Biosciences and Stoke Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caribou Biosciences and Stoke Therapeutics, you can compare the effects of market volatilities on Caribou Biosciences and Stoke Therapeutics and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Caribou Biosciences with a short position of Stoke Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caribou Biosciences and Stoke Therapeutics.
Diversification Opportunities for Caribou Biosciences and Stoke Therapeutics
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Caribou and Stoke is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Caribou Biosciences and Stoke Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stoke Therapeutics and Caribou Biosciences is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Caribou Biosciences are associated (or correlated) with Stoke Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stoke Therapeutics has no effect on the direction of Caribou Biosciences i.e., Caribou Biosciences and Stoke Therapeutics go up and down completely randomly.
Pair Corralation between Caribou Biosciences and Stoke Therapeutics
Given the investment horizon of 90 days Caribou Biosciences is expected to generate 1.06 times more return on investment than Stoke Therapeutics. However, Caribou Biosciences is 1.06 times more volatile than Stoke Therapeutics. It trades about -0.08 of its potential returns per unit of risk. Stoke Therapeutics is currently generating about -0.09 per unit of risk. If you would invest 216.00 in Caribou Biosciences on November 28, 2024 and sell it today you would lose (93.00) from holding Caribou Biosciences or give up 43.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caribou Biosciences vs. Stoke Therapeutics
Performance |
| Timeline |
| Caribou Biosciences |
| Stoke Therapeutics |
Caribou Biosciences and Stoke Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caribou Biosciences and Stoke Therapeutics
The main advantage of trading using opposite Caribou Biosciences and Stoke Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caribou Biosciences position performs unexpectedly, Stoke Therapeutics can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Stoke Therapeutics will offset losses from the drop in Stoke Therapeutics' long position.| Caribou Biosciences vs. Intellia Therapeutics | Caribou Biosciences vs. Editas Medicine | Caribou Biosciences vs. Crispr Therapeutics AG | Caribou Biosciences vs. Verve Therapeutics |
| Stoke Therapeutics vs. Adaptimmune Therapeutics Plc | Stoke Therapeutics vs. Black Diamond Therapeutics | Stoke Therapeutics vs. Relay Therapeutics | Stoke Therapeutics vs. Pliant Therapeutics |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |